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tv   Charlie Rose  PBS  January 28, 2012 12:00am-1:00am PST

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>> rose: welcome to our program, some interesting developments in republican politics the state of the union address by our president, we talk about all of that with david leone hart, greg ip, mark halperin and jeff greenfield of pbs. >> i think romney favored to win in florida, i'm not sure he will but i think people who think is over, the conservative movement, large portions are angry, they don't like the way gingrich has attacked this week and will have one pore gasp at saying do we really want mitt romney as our nominee. if gingrich can rise to the occasion he can be the vehicle for that and have a pretty big fight. >> we continue our look at economics with author nicholas-- his book is called cane, the clash that defined modern economics. >> and that tois the great division between the two of them. cane's always wanted to intervene. he always wanted to change the world and he merely
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wanted to tob and in see be the keynesian charges was always there, waking its finger saying it will all go terribly wrong. >> we conclude this evening with an appreciation of the life of mary duke-- a giant of a woman whowas a gre iend of mine who died in durham, north carolina on wednesday at age 91. >> her mother used to say never let the sun go down on your anger. and i say never let something like that ruin your life. you've got to make up with your parents. you've got to make up with somebody with whom you have had problems. and it was really wonderful, it really brought us together. >> politics and economics in the life of a great woman. when we continue. >> funding for charlie rose was provided by the following city, this is charlie rose. captioning sponsored by
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rose communications captioning sponsored by rose communications from our studios in new york city, this is charlie ro.
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. >> rose: we begin this evening with a wrap-up of the week in politics and the economy. la night the republican candidates faced off in the final debate before florida's primary next tuesday. mitt romney was on the offense any one of his best performances yet. >> i don't own stock in either fannie mae or freddie mac there are bonds that the investor has held through mutual funds. and mr. speaker, i know that sounds like an enormous revelation but have you checked your own investments? you also have investments from mutual funds that also invest in fannie mae and freddie mac. >> we should have had a whistle-blower and not a horn tooter. he should have stood up and id these things are a disaster, this is a crisis. he should have been anxiously teing the american people that these entities were causing a housing bubble that would cause a collapse.
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that we've seen here florida and around the country. >> i want to make sure i understand, is he still the most anti-immigrant candidate. >> i think of the four of us, yes. >> go ahead, governor. >> that is simply index causeable. mr. speaker, i am not anti-immigrant. my father was born in mexico. my wife's father was born in wales. they came to this country. the idea that i am anti-immigrant is repulsive. don't use a term like that you could say we disagree on certain policies but to say that enforcing the s. law to protect our borders, to welcome people here legally, to expand legal immigration as i approve, that that is somehow anti-immigrant is simply the kind of overthe top rhetoric that has characterized person politics too long. >> rose: there was also news on the economy today that the gdp grew 2.8% during the fourth quarter of 2011 although this was less than economists had forecast. president obama hopes to ride the wave of an improving economy to re-election in november. joining me to from washington david leonhardt of "the new york times", greg ip of the economist,
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mark halperin of "time" magazine and jeff greenfield of pbs's need to note. i'm pleased to have them here on this try to look at what happened this week in politics and what happened in the economy. i begin with politics, mark halperin what is the impact of ts debate on what was already happening in florida? >> well, it's not all that common to have conventional wisdom be absolute and nearly uniform across the political-- but i think in this case it is. there was some polling data suggesting that while gingrichurged across south calina he hain the kept up the momentum through the week. he hadn't performed well in the first florida debate and romney will use that performance to go to a lead and santorum's strong performance would take some votes from gingrich. the conventional wisdom is that romney is now set up to win this primary perhaps easily and have a decisive hold on the nomination. i think there are two pieces of that, that if you unpack them, one is prably true but not definitely and the other i don't think is true at all. if romney is in a pretty good position to win this de better on the early vote
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because there is more organized before gingrich surged and he has been very strong. his team has been very strong in discombobulating gingrich not just in the debate but on the campaign trail. romney winning this, though, i don't think settles it because gingrich is now angry. and if you look at the calendar, although the conventional wisdom is it favors romney in february t gives gingrich opportunities to try to come back, even if he loses. >> rose: more on that you have been in florida doing interviews for need to know, especially with some of the older citizens down there. give me a sense oflorida, mood in florida, what is on their mind. >> i talked to people and what is on their mind is cause you've got this interesting potential tension. the republicans as a group, as a party have been pushing entitlement reform whether it is paul ryan or almost any of the other major voices. the aarp, not a disinterested observer, took a poll last november that showed the overwhelming majority of florida republicans don't want this touched. and perhaps even more dramatically they don't want to touch for younger people
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cause that's the approach at t entitlement reforms say. we won't touch grandma and grandpa but you younger folks we might. and the seniors feel that is a foot in the door. and you know, i think more broadly, when you go beyond just seniors but certainly was the people that i talk to, you heard what i think is still the fundamental overhang to use-- the fundamental overhang of this whole election which is a deeper fear than we have seen in a long time, that the good times are over. that the united states is facing a period unlike any we've seen in decades. that the low hanging fruit has been picked and we are going to be a scarcer place than we were and our kids are to the going to have it nearly as well as we did. >> voters will vote out of fear rather than hope? >> certainly to-- certainly anxiety and the other part of this which i don't want to filibuster here is the question of who gets the blame. if there is a resentment fact their gingrich has tapped into and he has, in a way, is president obama interested in turning that resentment toward his
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adversaries namely the wall street financial folks. because i think people have said wait a minute, to coin clinton's phrase, we worked rd, we play by the rules. the ground is eroding from under us. what are we going do about it, without do we vote for to protect us and without do we vote out who is helping to be responsible for this. it's a very kind of-- be there for months i think >> rose: let me go to washington, dave, you are the bureau chief, but economics is where you won a pollitzer prize. tell me how you see the political campaign and the economic issues in it so far, especially in florida. >> well, clearly romney started off running a campaign based on the notion that the economy was going to be the defining issue this year. if you go back and look at his announcent speech which i think was a fairly effective political speech, i was struck at how much it borrowed it selled from bill clinton's 1992 campaign. the idea of saying this time to a democratic president, you've had your chance. it hasn't worked. give someone else achance.
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we do now see the sort of bubbling up, this possibility that the economy will improve. it has been improving a little bit. then again we've had three straight years in which the economy improved early in the year only to be set back by some combination of forces, often involving europe, sometimes involving gas prices. and so i think the really big uncertain question is going into the general election, is do we feel like we're on an upward trajectory which would obviouy be very goodor obama even if things are still not good. or do we feel like we are yet again kind of bumping along in which case this economy first campaign that romney imagined and i think it's important to say, the white house still sees romney as the overwhelmingly likely nominee. that doesn't mean it will be wrapd up quickly. done even mean the white house right but they think they are going to be running against mitt romney. that economy first campaign that romney was planning, if the economy gets knocked off stride yet again is mething that you have to think will have a very good chance of succeeding.
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>> with respect to the economy, greg, would look at this week where we had both the federal reserve making a kind of pronouncement abo how they saw economic recovery in the future of changing an interest rate as well as the numbers that we got at the end of the week. what do they suggest. >> well, there is a kind of deflating week on that score, charlie. in the last few weeks we kind of felt a gentle wind with some numbers like claims on unemployment insurance and the unemployment rate coming down and the stock market doing reasonably well. what we learned friday is the economy grew at only 2.8% annual rate in the fourth quarter. now albeit that was the best rate in a year but that was after a pretty crummyier and less than people had been hoping for. if you look at the components of that growth, i mean exports were weak, consumer spending was weak. a lot of the growth came from firm as cummulating inventories which was not a sustainable source of growth. and the federal reserve kind of ndicated that sort of downbeat view. they came out on wednesday with a remarkae package of
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announcements. where amonother things they lowered their forecast for growth this year. and they said that the interest rate which they had already said ty hoped keep at 0 until at least the middle of 2012 would probably stay there until the end of 2014. noon the one hand awe plaud the federal reserve on the one hand by saying this growth is unacceptable. so we're doing these moves to try and like spur a little bit more. but on the other hand it's a pretty grim statement about how rough things are, that they feel compelled to do this. >> so this is bad news for president obama? politically. >> it's bad news in the sense that shall did -- well it's bad news in the sense it is affirming what we already knew, that the economy is weak. but it's positive news on the margin in the following sense, that the people who are able to do something about the economy are doing it. the fed's actions on the margin will help. it will help keep long-term interest rates down and one of the surprise positives of the last few months ithat the housing market which was more or less given up for dead in the past years is low and behold showing signs
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of life. more people asking for mortgages. more people buying houses. home builders who had been basically all sort of preparing their bankruptcy filings now seeing more traffic through their model homes and so forth. and the fed's action will help on that score. and going back to something that david was saying about, you know, obama sort of like campaigning on the economy this year, when i oked at these numbers, i was struck by the similarities of what we are seeing now. and 2003, actually, in the fall of 2003 the economy had shown almost no job growth. the democrats were hammering bush as the first president to preside over no job growth sinceoover and so forth. and it turned out that 2004 was a decent year. decent enough to really take away that liability. now obama has a much bigger hole to dig himself out of this year. but if the mix of news this year tends towards rather positive, rather than negative, i think that that suggests that his chances might be better than we've been thinking. >> this also raises a
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question for me to both of you about lex ability. that was romney's issue. then after south carolina and after the sort of rage anti-elitism announcements of the speaker, it seemed that he had tried to grab he elect ability and no longer was it a negative for him. does it still play and how does it play. >> he elect ability for romney? >> yes. i think it is a very positive thing for him. within the people in the republican party who have wrung their hands about romney as a weak general election candidate, people who tried to draft other candidates into the race, gingrich is weak and erratic performance this past week makes them feel like romney is a safer choice, head-to-head polls the president against the two republicans lately have been very much in romney's favor. and romney's ability to go after the president and-- to go after gingrich, rather, and his stng debe performance is giving people confidence, maybe this guy can pull it off. on the other hand, even as he has been going after gingrich he effectively, lebl ability, the question is he elect ability on his personal financial
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disclosure and taxes really has unnerved some republicans. you saw rupert murdoch tweet out about taxeturns that he felt this made romney unhe electable. and that say big concern for republicans, that this notion of romney as someone people can't rate to, as someone who has a tenure about his own image is something that really does-- . >> rose: my impression is he had done well in this debate by basically saying look, i earned this money myself. and i'm not embarrassed because this is what americans admire. >> as a matter of thee at call performance no question he did it well in the debate there are still a lot of questions within the political community that are defining romney for people paying close attention regarding what these accounts were all about, symbolically and substantively and we don't know the answers yet. >> i would also point out -- >> charley-- . >> rose: . >> the full roated defense of entrepreneurial capitalism or private equity or however you want to characterize romney's performance resonateone way with the republican party. it may resonate in a very different way with the 130 million americans who vote. and that's part of the trap.
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we've seen this in state elections. we've seen it nationally. when you have to move to satisfy the base in the spring, you've got a lot of ground to cover in the fall when are you talking to a different group of people. it's clear i think it's a good work that mark used, theatrically romney looked better last night than i think we have ever seen him. gone was the bumbling incoherent of trying to explain himself. he was strong. the clip y showed was quite dramatic is you had a taller romney, being very style kpx, lking at gingrichho would not even look him in the eye it was a coanding perfoance. but the argument, i mentioned this at another place we were at, the notion that the republicans are going to make thurston howell the iii who goes to the union club and asks dinky to come in and handle his blind trust, that may not be the best place to be in the fall of 2012. and romney still has work to do on that. >> rose: i think was greg that i heard or was it david, either one. >> it was me. it's actually, it's good a followup point to jefs. which is obama has long had
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this weakness among working class voters, right, hillary clinton beat him among lower income voters. she beat him among people who don't have colge degrees. and obviously he is strong among latinos and african americans but he is extremely week among whites in that group. and what is interesting about romney is that in some ways it may take the electoral map a little bit back to what it used to be. it seems to give obama more of a chance in a place like ohio because romney may be even weaker on some of those issues. 's still going to work the white working class male vote but the question is by how much. but he may be weaker there. he may be stronger among some of the kind of independent suburban voters in places like colorado and virginia. and so the obama campaign was looking at the map and they were saying how do we win without ohio given some of our struggles there. and they talked about lorado and virginia and north carolina. what is interesting with romney is he may take effect of something that is a little more like a bush
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carey map. we have no idea how close it is going to be in which the industrial midwest may actually ultimately be the thing that determines it. and it's just interesting to think about how obama and romney in this economy both have sometimes had trouble connecting to that working class reagan democrat vote. >> charlie f coy just jump in there for a moment. i think an interesting question is here that obama realizing that his economic numbers are not anything to boast about, is trying to portray himself as a person without people can relate to better in terms of looking after them in coming years. and th is why the attack on romney's wealth. it is an interesting question, i think, because historically rich bashing hasn't been very good for winning presidential elections. it's not a country where we resent the rich, we actually want to be rich and so on. but romney's background may be a liability and suggesting the template is different. traditionally i think americans thought of the rich people they admired were people who sort of made things. people like romney's dad who ran a car manufacturing
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company, what hurt romney so ch in the last few weeks is not the fact much that he is so wealthy t is that the wealth has been so associated with this high octane finance with so many people blame the financial crisis. the big question mark in my mind will be in coming months assuming romne does prevail, does the business background which was souch his, like, the main factor on his resume which suggested he was a guy that could beat obama, does that continue to be the case or does obama and the democrat successfully use the kind of wealth class division issue to try and beat him down? >> thought on that? >> to me it always back to controlling your public image. romney has not done a particularly good job of controlling his public image this week even as he is defining gingrich in ways that are eliminating him as a prospect, at least in florida right now. romney has got his olympic resume, his positive bain resume and he's got his record as an executive in the private and public sector. >> rose: and as governor.
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>> as governor and private sector. all of that has taken a backseat to why dow have an account in the cayman islands y do all these people who worked for bain companies lose their jobs. why are you uncomfortable talking about your tax returns. he must, if he's going to be president, he must get back to being in control of his public image and projecting the positive aspects of the private sector record. the demoats have been killinhim this week. again even as he has been dealing effectively wh gingri they have been killing him on the bain stuff, on the tax returns, on the cayman islands. and they have to the been able to tight that successfully. successfully enough with the public election but not the general election electorate right now. >> being a repository of mostly useless political information, i remember a campaign in 1976, bill brock was a senator. it came out, he was a wealthy man, that he had-- . >> republican senator from tennessee. >> he had used all kinds of tax avoidance skilled to pay a low rate in taxes. all that fall, thousands of buttons appeared in tennessee reading i paid more taxes than bill brock.
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and he went down to a rather, you know, stunning defeat at the hands of jim sasser. i think the point, you know, that was made earlier about it's not that you are rich, it is how you got rich, and what did you contribute to the country in being rich. i mean henry ford, another piece of information, won the 1916 michigan republican presidentialrimary. people thought of him as a potential president. we often look at business leaders and say well yes, that's an executive. but the idea that you, having gotten rich, you put your money in these exotic places and you pay an effective tax rate, you know, lower than maybe his secretary, this is a problem that i think is going to loom over romney should he be the nominee all fall. i can see those buttons being dragged out of storage right now. i paid more tax thamitt romney. >> david, do you agree with that. because floyd norris i think wrote a come in your paper basically suggesting that roey had this. he had-- had a ver positive record on charitable
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contributions especially to the church. >> yeah. this is not a good issue for romney. i mean romney does pay vastly more taxes it sounds like than bill brock did. romney pays a lot more taxes than the vast majority of americans do. he pays a significantly lower tax rate than most affluent people. as best as we can calculate it, and there are 30 different way to look at this, romney pays a direct federal tax rate that resembles somebody making about $80,000 a year. so that's higher than average. but boy, it's not that high for somebody who makes as much money as he does. and to the extent that if he is the nominee, the democrats can paint him just as jeff's saying, not some of as-- it's not shoot that he was successful, it's that he somehow is skirting the rules. and i think that is when you tie it up with the other bain stuff and the outsourcing and distrus of wall street right now, and quite frankly tied up with
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his cpaigning style, right. he's n the most comfortable guy in a diner. i think it is dinitely a liability. >> rose: mark f romney is the nominee, and the president campaigns across the country on fairness, and the buffett rule, is that a winning argument for the president. >> the polls suggest it's hugely winning argument. and romney you almost couldn't write a better resume for someone to run against on those kds of issues. >> rose: it will be central to the president's campaign if you listened to his state of the union. >> absolutely essential. now on t other hand it's easy to forget when the president is having a good we can and the republicans aren't, the president will still have to defend his record and still have to debate romney or whoever on what are you going to do in the future. so romney has to be an acceptable alternative, some ofhese biographical things put him in danger zone like john kerry became, of to the being acceptable. but if he can become acceptable as an alternative, acceptable on fairness, acceptable to hispanics and working class voters in ohio,
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can make this a competitive race. but he's going to have to be better than he has been for sure. and the president on that fairness stuff, he's been making if and not winning the day with the republicans in congress, winning it with the public, a presidential election gives him a chance to get the public on his side and win in politics, which he's to the been able to do in washington rses one of the big issues last night as we saw was immigration. does immigration in a general election cut against a nominee named mitt romney. >> yes, because he has gone, i think, far further than he needed in taking positions that wl really alienate hispanic voters. you talk back to the map as david was, colorado, north carolina, virnia, some of the southwestern states, romney is going to need to substantially improve his standing with hispanic voters if he is thnominee. >> this is a stark political reality. we saw it in play in 2010, in california. meg whitman with all the money in the world, was forced by primary opponent who had one issue, and the one issue was, i don't know what to do with the immigrants but you know something really draconian.
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she was forced far to the tough stand on that. the day after the primary she started to try to backpedal, you know, like willie mayes in centerfield under a fly ball saying spanish language ed t never worked. the hispanic vote was one of the reasons why she lost. i know there are plenty of republican was look at those exit polls from 2008 and see that when george w bush did pretty well, 40% or more in 2004, mccain got beaten-- mccain remember was at the time a reformer on immigration, was beaten almost 2 to 1 on the hispanic vote this is stark political reality. and it's again that rule that when you have to appeal to a base in the spring, you know, in e fall you have a price pay. >> rose: greg, one of the thing as that -- >> charlie, i remember-- sorry, i remember being in a general store with romney in the 2008 campaign in new hampshire. and someone in the audience asked a question that had nothing to do with immigration. and he turned it into an answ about illega immigration. very tough answer.
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and i think one of the reasons why going all the way back four years he's decided to make this his issue, is unlike a l of the other issues that hard-core conserve fivs care passionately b immigration is not on where romney had to do a flip-flop. so being really tough on it, unlike say abortion, was a way cosend a message to them that felt more authentic. that he is one of them. but it creates exactly this general election problem that mark is talking about. latinos will ba bigger share of the electorate in 2012 than in 2080. >> my question is could he have gotten, could he get the nomination, it's too late to ask, could he have gotten, could he get the nomination without having gone that far to the right on immigration? >> i think so. he should say what he believes and i'm not suggesting he doesn't believe what he is saying but is a matter of emphasis. john mccain for a while emphasized a comprehensive immigration reform that had provision in it, a path to citizenship. he won the nomination by going back and stressing, closed down the border, but in a general election he was able to come back.
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romney is against the dream act. he has got this personal history this is another biographical fact we'll see again if he is the nominee, of hiring these gardeners, yardworkers who were illegal aliens. he does not have a great story on this, that will allow him to i think benefit net-net electorally, the hispic vote is too important, it is a bigger share of the vote than fr years ago. it's too big a deal. cohave done a better job, not changing his positions but in terms of emphasis. >> one issue people look to and say if it goes bad, it could really affect this election is greece and europe. what is the timetable there and what is likely to happen there. and does it have a timetable that could influence this election >> the timetable is as long as the europeans can keep on talking and not doing which basically means forever. so i think it is an issue that is to the going to go away before november. on balance what we've seen in the last few in the news went from terrible to maybe not so bad. still bad but not catastrophic.
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it's clear that the european central bank by basically pouring money into the banking system has avoided the most catastrophic outcomes. so europe is going to have a recession but it probably will not be a severe reinvestigation-- recession. we have greece which seems to be stumbling towards some kind of agreement to restructure its debt with its creditors. i anticipate that that will probably happen sometime in the next week or two. the bottom line is greece has to make a bond payment on march 20th, a little under a month from now. and they have to come to some agreement with their creditors for this to happen. i think that will ppen. but that doesn't get us out of the woods at all. we still have severe austery being put in place in countries like italy, spain and france, to try and win back the confidence of bond markets. it's very bad for their economies. that's having a negative effect on american exports, the american economy and i would add that you know, earlier on david had pointed out that you often get like bad luck happening in a year that basicly tanks the economy. a year ago the number one
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thing was a big jump in oil prices. that is a thing i worry about most this year as well. i mean the thing bubbling away in the background is the, you know, the sanks that are being tightened around iran. and in that sort of situation, very unpredictable things could happen. if iran did try to close the strait of hormuz or some other sort of development like that and oil shot up to 150 dollars, there goes the economy. and frankly there goes obama's re-election. >> rose: when you look at the proposals that the president made in the state of the union, any new ideas there that you think are refreshing and an indication of where you think we ought to go? >> you know, the state of the union was a mix of big ideas that are not going to happen because congress isn't going to pass them and relatively small ideas that the president can do on his own it was very much a political speech. jonathan chafe had a nice piece about this on "new york" magazine's web site saying the president spent the first two years trying to get stuff passed and not thinking enough about the politics. and now he pivoted and is thinking about the politics and focusing much more on how things are going to play
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than wt is actually going to pass because almost nothing is actually going to passo that is the overlay. i would pick out one little issue that i thought was kind of interesting. which is this notion that there should be an up or down vote withi 90 days on any presidential nominee. w i'm not predicting that it's going happen because m not predicting that anything is going to get passed kroning with the possible exception of payroll tax extension. but this is an interesting issue because you could imagine pushg it by saying to the republicans, hey, if you guys think are you going to win, later this year, this change would actually benefit the democrats a lot more than the republicans. and so if you want to think about a fix for some of the really serious procedural problems we have, the fact that presidents can't get their people into jobs, you actually could imagine maybe there is a way to fix that. and i was struck to see that included in the state of the union. >> rose: go ahead. >> just the-- i think you meant it would benefit the repuicans who were the democrs if they thought they would win. but the basic point. >> i did.
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>> you are asking a group of senators whoow have the kind pov we are where one senator can bring the entire machinery of government to i a halt and in some cases not tell you why. i almost wonder, david, whether that doesn't transcend politics to say to these senators, look what you give up if you let up or down votes go on. you don't ha any one person with the whip pan. i don't know. as i have-- i don't live in your tourntion i live in the heartland of america, new york. but the idea that a washington senator is going to say yeah, okay, i'm going to give up my ability to put a hold or to block a nomination that i'm not keen on, isn't that asking a lot of these folks? >> iis. and as i said, i'm not predicting that anything passes thisier with the exception of payroll tax. but i i do think that sometimes the way these things happen is they get out into the public debate and slowly they start pick up moment and energy. and sometime down the road they happen. and that was one of the these little ideas that i could imagine becoming more a part of the public
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discourse. >> rose: thank you, thank you jeffthank you. >> nicholas is here, a journalist, an author, he has written books on ronald reagan and margaret thatcher, rex harrison and pet oth ol. his late cess about two opposing forces of economic thought. mighty forces, they are john maynard keynes and frederick hyack in the clash that he it fined modern economics he chronicles their theories on influence and public debate today. the two men debate aid question that has always been central to the study of economics, should government's intervene in markets. i'm pleased to have him back at this table. welcome. >> thank you, charlie. >> rose: pleasure to you have here. how did you come upon this as a book that needed to be written. >> it was a story that i always knew and people who flew about it when i went to my agent and said i want to write about kanes when there was a resurgence, he said well you can't. there are too many book about keynes but there is an
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element which hasn't been told plaorm. d i said yeah, because keynes won the debate effectively and ruled the roost for 30 years after the war, they bureaued hyack. so if you lo in all the biographies of keynes, hyack gets an honorable mention but it was much more important. his intervention was muc more important. >> rose: what did they think of each other? >> in the first place they, well first of all keynes sdnlts know who hyack was. there was 16 years difference between the two of them. he was world famous when hyack is out him out. and hyack went to seek him out specifically norld to raise his reputation, really. they met in 1930 for the first time and instantly fell into arch argument. one of the great things about keenes he was so intellectually confident that whoever took him on he was happy to pick a fight and answer the question. then they resumed their fight in about 1931, or absolutely in 1931 when hyack was specifically brought over to the school of economics deliberately to
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bring down keyne,s in his tracks. anthat is when the debate began seriously, trying to untangle the differences of view about whether you if you see something going on that you could change, whether you should intervene or whether when you see something you don't like, whether you should shrug your solders and say well, there is nothing much we could do about that. >> rose: outline for us the differences in their opinion about the way economies and markets and governments operate. >> the beginning, they both started the same base really. they looked at the busess cycle. which and they both concluded that this business cycle went up and down and up and down throughout history and they wondered at provoked it. what made it go up. what made it come down. and they both decided that actually that should be the focus of their study. and keyneswas looking at it from a slightly different point of view. keynes had endured during
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the 1950s wide-- in britain and was irritated and said we're going to do something about this he was a man of practice, if you like. he was an interventionist just by nature. he want aid change to make the world better. hyack was the singular influence on him in terms of a natural event. >> yeah, well the event. and he is a very prosperous young man >> always did well. >> brilliant in the market. this great socialist as many americans, a genius of the market. >> but he had also been to eden, he had had ermous amountof privilege and the part of his characte were that if you have had that amount of privilege, that therefore you owd it t people without didn't enjoy quite as well this is classic elish-- and that is not something that worried hyack. highas back a different creature all together, a literally buttoned up, three buttons of his jacket buttoned up. little iron framed glass.
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very crisp in a way that today, austrians and germans can say something to you. and say of course, taken aback, hold on a minute. i wasn't disagreeing with you. but there was a crispness about everything he went into. but he was just interested in looking at the business cycle purely as he was concerned, an impartial scientist. he said he went up to economists to intervene, it was up to economists to explain what was going on. and that too is the great division between the two of them. keynes always wanted to certificate vene and change the world and hyack merely wanted to observe it. and in seeing the keynesian changes was always there wagging his finger saying it willll go terribly wrong t will all go terribly wrong. >> from the 60s my remembrance and recollection when i began to understand what they both stood for was the great po upon ent of keynes at that time was john kenneth galbraith and proponent of hyack was
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milton freedman. >> yes. >> and they had e debate all over again. >> they z indeed. it never reay quite went away and one of the reasons is that 80 years ago in 1931 when they did their enormous fight with each other, sometimes two personal letters a day pinging back and forth. in the days e-mail that means noing, but in the days of snail mail to get to the post office to deliver two letters a day was extraordinary. but they really never laid a glove on each other. they never got beyond first base, all they were doing was describing can the terms and they couldn't even agree on that. had one of them struck the over one out of the ring, i think the whole history of economics may well have been very different but they didn't. and so it wanted until later that this uolved dispute then got dug up again and became really the core of difference today between people on the left and people on the right. >> rose: and what is that. >> and that is that if you can manage an economy to improve-- improve the lot of your citizens, you should. which is the o bomb-- obama
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position. that you should stimulate the economy there are ways to get the economy moving. you might have to borrow money do it or spend money that you don't v you might have to cut taxes which actually is a keynesian notion, not a high agoanian, putusiness taxes at the bottom that will put money in the people's pockets. jobs bill that mr. obama is weren'ting is a stimulus, half a billion stimulus, half a trillion stimulus which goes on top of the other trillion. and the other side, the high agoian side says we don't know enough about this stuff. are you just wasting a lot of our money and it's all going terribly wrong. >> in your judgement did the stimulus work, not perctly but did it work. >> it plainly worked ifment pump a trillion extra dollars into the economy. >> rose: in china, the united states and other places. >> it universally works. if you hose money io an economy, then you get some rewards. now we could go into the details why the trillion wodn't be enough. and there is no doubt that a
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lot of money went towards lending money to states so they didn't have to fire their works and so on. >> rose: a lot had to do with tax. >> a lot of that trillion already was sort of paid for. >> rose: we're not sure they chose the right protec protect-- projects to stimulate. >> it is always very difficult. if we had a billion dollars to spend by midnight we would make some really stupid decisions. >> rose: what about people who support the pure theories of frederick hyack say out a stimulus at that time. >> well, hyack said that actually yes a stimulus would work but it wouldn't work properly it wouldn't work anything except in the short to medium term. so you could reduce interest rates. you could employ people throh the government, but as soon as that subsidy dried up, as soon as the government attempted to help dried up then you go back to the previous state a and it might even be worse. >> would he argue don't do it at all because eventually when you withdraw it you will go back to the internationalal.
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>> it was artificial, are you using energies and entrepreneurial genius and money in ways which actually would be better spent almost anywhere else tn creating these artificial jobs. >> how is hyack influenced by the rise of the nazi. >> hyack to his great credit was never interested in any of the worst aspects or in any of the aspects of nazism. and it is an interesting thing. come world war ii, friedrich hyack volunteered to be part of the war efforts. he said i speak ger machine, fluent ger machine, i'm violently o polesed to the nazi recommend even. i will do anything you want me to do in terms of broadcasting or whatever. and he was turned down. and in his, so he said this is a strange position, here i am ready. >> rose: why did they turn him down. >> it's not explained and there is no record of telephone. he got all sorts of very important people to recommend him and they still turned him down. but then what he wrote instead in the late-- in the middle of the war was the book by which he's really well-known now which is the
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road to serve student tude. he was looking at the soviet communism and nazism together and he is say wag is the thing that actually joins these two terrible movements together, is that it's because they've purged the marketplace. they have taken over. the government has taken over from the market. d the more that the government takes over from the market, the more it tends towards totalitarianism. >> rose: who best articulates hyack whether a politician or pundit. >> george will might be an example. >> he is not, -- ron paul and rand paul they are the closest. they are almost true hyackan. >> rose: and true libertarians. >> they are really not conservative. hyack yet a very famous essay saying why i am not a conservative. he didn't count himself a conservative he was sort of himself a libertarian. and all of the ideas that ron paul has about abolishing the fed, that's exactly high
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backyan. he thought that even if you left the rest of the world to a free market as long as the government owned money, as long as it controlled the money supply and controlled the cost of money, the interest rate, then of course would you never have a truly operating free marketo he was always against the fed, which ron paul has taken up with a great vengence. >> rose: but there was always margaret tlacher. >> marret tlache and ronald ryg an both read hyack and indeed margaret tlacher used to go around with a copy of one of his books in her handbag and if she hi in trouble she would slam if on the table and says that's what we believe. so she was a great high agoian, as well as ronald reagan. he was a man who was, he had made an annual visit to london where he used to explain to like-minded people his philosophy, just to freshen them up a bit and mrs. tlacher start add tending those and much to everybody's surprise, in the presence of the master, she was entirely silent. the only time she h been
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known to be silent around a trouble. interestingl he didn't take much of either margaret tlacher or ron ol reagan rses why? >> because hes a utopian and thought that ol politics was necessarily a compromise. and inevitly, therefore, he was flattered. but at the same time he said don't blame me for anything they do. because they're not doing it so-- . >> rose: so chris hitchins died, a front-page story in the no times, someone i loved having on the program for all the obvious reasons, he was a great conservationa conservationalist. how do you remember him? >> i have no christopher for 40 years, maybe. and i was a part of a group of young journalists and writers who were brought up together, as young men in our -- by a man called-- howard who was a great editor of the news magazines. he had no children of his own and we were brought up as tony's lost bars, am moss,
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barns, many, many people. and therefore i had this strange sort of frat ent which hi with hitch which meant that actually he could never allow me to disagree with him, you know. as much as i wanted to have a fight with him he was always very sort of, there was a reproachment always to the end. >> it went back to the new stateman at that time. >> and it was very fendly and he was always open hearted and warm. >> we say to you like nick i know i disagree with you and we'rnot going to have a fit. >> no he said let's have a fight, let's forgivend forget. >> he would always hava fight, like ca, keynes like that. >> as good a debater as you ever saw. >> i don't think he was entirely fair but maybe debates shouldn't be fair. he was quite capable of hitting below the belt if he ever saw an opportunity. but yeah, i mean this is somethg that of course comes out of sort of british school life. and that is that you debate from a very early age. and i think that he took a lot of that to heart. and then at oxford he did even more. >> it's a great story of
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friendship though, isn't it martin and hitch and- >> yeah. >> and ian and hitch and rushdie and hitch. >> yeah. >> all of them were bonded by this sort of maybe i didn't realize it went back to the new statesman. >> but it is a remarkable study of friendship. >> it is. an i think particularly when hitch in the last couple of years, when hitch went downhill. it was something i think that hitch who might have thought happily in a way that he was friendles he quite liked to point out that he was friend tolls people, but the fact that there was a core of people. and you didn't need to do much, just a quick e-mail here or there sing are you okay. and you just knew that there were people minding out for him. >> book is called keynes hyack the class that defined modern economics it is still with us. it will be part of the debate that we will see in a campaign herin america in 2012. our thanks to nichos, thank you. >> thanks, charlie. we conclude this evening remembering mary duke-- she
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was an amazing woman that anybody who hears the sound of my voice would have loved if given the privilege of knowing her. she was small in stature with a giant heart, dedicated to art, to ideas, to civil rights and to the people in places she loved. mary died on wednesday at the hospital at duke university found bid her great grandfather washington duke who built a huge fortune in tobacco university and endowed duke university. she was 91, after an early life inmann mann she moved to dur ma'am, north carolina, attended duke university, and married a young doctor josiah charles trent who died at the young age of 34. she later married dr. james see mens who died in 2005 at the sage of 94. mary spent her life devoted to north carolina and durham and duke and especially the arts. she is survived by seven children, 16 grandchildren, and 29 great grandchildren. she was as richard broadhead the president of duke said, a force for good.
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former president dr. keith brody called her the nscience of duke university. i called her my great friend and i would always call her when i came home and often visited with her. when ever i received aya honor from my home state she was always there by my side. each year she sent me a giant christmas card with a photograph of her surrounded by her huge family. i kept it on my desk all year to remind me of the value of family and what it has meant to our country. mary watched my television programs often and once she appeared here at this table with me in 2008 with her cousin anthony drexell duke who is now 96. >> tell me who influenced you most in your family, and how influential on you was the separation of your parents. >> well, you know, my grandmother probably had the greatest influence. very strong lady. sara duke, the gardens of duke named for her. >> sarah duke gardens,
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right. >> a very strong person. she, my mother was very ill in new york. she didn't seem to feel that i should be in a kind of sick room atmosphere. so she said come live with me, and go to duke if you n get in. and she said-- so it was see, i was only 15 when i went. and i got in as a special student because they were taking some nursing students as special students. and dean baldwin who was also a big influence on me, said you can come if you make a c average the first semester. but if you don't do t you'll have to go and finish high school at durham school and that was fine with me. but hewitt school in new york had a marvelous curriculum for english. and that's what pulled me through. i made as in english. and that pulled me along because hi had no science. and of course hewitt is
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wonderful, they have science and everything else now. but i will be eternally grateful to them for having done that. >> but just tell me for a moment that the breakup of your parents had this, what impact did it have on you? it just left a sense of lonelylessor being alone. >> it was a terrible thing. >> rose: insecurity, feeling -- >> it was, pie father and i used to eat breakfast together. it was a terrible thing. but the one thing, and i would like to fell you that i carried away from this a situation which i think i would like to share with everybody. for a long, long time my dad and pri not close. he would write me letters. but i kept resenting all of it. he, they were divorced, these people. and he remarried a perfectly wonderful woman who was a
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canadian back, women's air corp. >> that's right. >> and she was absolutely marvelous. and we're still very good friends, oh very good friends. and they had two children. and they were wonderful, and we're friends too. but when i was courting my second husband, i lost my first one, wonderful man, when he was 34, jim and i, i just lost him three years ago,. >> we were married 51 years. but anyway before we got married, he said you know, mary, i don't really think we should get married until you talk to your dad. it would make me feel better. >> jim said that. >> i said i think you're right. so i met margaret, his new wife and dad and i was ask by the board of trustees,
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recently, mother used to say never let the sun goown on your anger. and i say never let something like that ruin your life. u've got to make up with your parents. you've got to make up with somebody whom you've had problems with. and it was really wonderful. it rely brought us together and i had to talk to the trustees once. and someone came up to me and said this has done something for my family. because there was something like that going on. you muss not ever let somethingitter influence the rest of your life. >> why did you stay in durham? why did you go to durham? you had this mansion in new york city, duke mansion, which was fantastic. >> well, i felt like a human being in durham, for one thing.
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>> hi a great thing happen when i went to durham. you interviewed, i think many years ago, a man, john hammond who was a vice president of naacp and a big, you know, he discovered aretha franklin, so on. before i left i was very close to his wife. >> used to work for cbs. >> there you are. he said you've gotto look up some of my friends. one being lewis boston who was head of th blk newspaper in durham. one of the things i did when i moved to durham was to call lewis. oh, he was w just wonderful. and i got to know a group of african-americ friends i wouldn't give anything this this world, i mean they were so fabulous, john wheeler, shag stewart, mr. spalding, the whole family. >> rose: they formed north carolina mutual insurance company.
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>> that's right. and mr. charles spalding, mr. cc as we call him, we used to go up and down jim and i on the train to new york when i had to go up to meetings. and we talked about the school situation, and so on. so i felt for the first time that there was a potential for everybody to work together in durham. and it was wonderful. and i wouldn't give anything, of course civil rights became kind of my mission there. >> rose: exactly. >> and i got so much cooperation. it was so wonderful. and so there was no reason to leave durham. i mean it was just, durham is kind of a wonderful place. >> rose: and all north carolina thanks you for that. let me talk for a moment about why were you progressive in having the attitude did you about human rights, about civil rights and about the arts and about working together. where did that come from? >> well, i think-- a lot of
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it came from, i can't say that it didn't, it came from my family. we never did talk a lot about it. but i will tell you this, it's very interesting in a way. you know t many people in the south talk about the civil war a lot and looking back on it, we never talked about the civil war. but grandmother and grandfather always had african-american people around. now i realize that things were still segregated. but you would not have thought so in a way. >> rose: so let me talk about today. duke university's gone on to be a great university. >> it really has. >> rose: -currenting to that in the endowment. >> i think uncle bob, they would-- it's what they wanted. >> rose: james buchanan duke. >> that's right. but i'm telling you, i'm sure that they would be amazed at how fast it's grown. >> rose: what is the endowment today? >> i don't know but it's going up.
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>> it's going up, despite the problems. >> aolutely certain. i wouldn't want to be completely wrong. >> rose: so academically it's got great medical school, great law school, great school of engineering. >> divinity. >> rose: great divinity school. >> environmental school there. >> it's just been great. the thing i too that we have to remind everybody that it's gotten that way without a huge endowment. everybody thinks that duke had a big endowment. >> has a great endowment. but it's fairly far down the list. but people work on it they really work on it they love it. >> rose: i did this segment because these are two people i like very much. that's number one. and number two mary has been my greatnd dear and supporti friend. and she has done so much for friends, for duke university, and for the state of north carolina. and tony has lead this really remarkable life. and it's in this book on
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chartered course, a voyage of my life. i want to say the final thing about the two of you. it is about family. you all remind me of famy that families grow and they split and they come back together and the lesson you said is an important lesson. >> i do think so. >> and it's also the idea to sit here with two people, you know, who is 88 and the 0 and who he such vitality is an encouragement to all of us. so. >> thank you charlie. >> that's lovely, charlie. >> i thank all of you very much, it's a pleasure to you have on the program. >> a mourn not being able to hear her lovely voice again but her spit lives forever. mary seimens dead at 91.
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